In a major policy shift, the U.S. Securities and Exchange Commission (SEC) may soon introduce a “regulatory sandbox” for digital assets, giving crypto firms room to grow and innovate while the agency finalizes long-term rules. This initiative could mark a pivotal moment for blockchain startups and tokenized securities in the U.S.
Acting SEC Chair Mark Uyeda revealed the agency is considering a time-limited exemption framework for both registered and unregistered crypto companies. The sandbox would provide a legal safety net for innovators while comprehensive crypto regulations are being developed — a move that contrasts sharply with the SEC’s previous enforcement-heavy approach.
A regulatory sandbox is a temporary legal environment that allows market participants to test innovative financial products without fully complying with existing rules. In this case, crypto firms could experiment with blockchain technologies without fear of immediate legal repercussions.
According to Fox Business reporter Eleanor Terrett, the idea is to strike a balance — enable startups to grow while regulators catch up. “It’s what the prior administration could have done,” she said, “but instead they chose to sue companies for not being compliant.”
During the agency’s second crypto roundtable, Uyeda emphasized the need for a unified federal regulatory framework. He suggested that the current system — where companies must navigate a patchwork of state-level licenses — stifles innovation.
“While the Commission works to develop a long-term solution to address these issues, a time-limited, conditional exemptive relief framework for registrants and non-registrants could allow for greater innovation,” said Uyeda.
The SEC is also actively seeking public feedback from blockchain developers, trading platforms, and investors on where exemptions would help most. The goal is to offer targeted relief in key areas like blockchain-based securities trading and tokenization platforms.
Although momentum for digital asset regulation is building in Congress, no crypto market structure law has passed yet. Lawmakers believe legislation may arrive by the end of 2025, but the process of drafting and implementing final rules will still take time.
Until then, Uyeda stressed that conditional exemptions can help credible crypto firms move forward without regulatory uncertainty.
At the roundtable, legal experts and industry stakeholders agreed: the current securities framework doesn’t fit crypto. Issues like decentralized trading, high-frequency front-running, and lack of disclosure requirements in crypto markets were cited as urgent challenges.
Commissioner Hester Peirce, a longtime advocate for crypto reform, reiterated that Congress and the SEC must close the regulatory gaps. She emphasized the need for clarity in situations where firms offer both security and non-security tokens on the same platform.
The SEC has outlined a roadmap of roundtables to tackle major crypto issues in the coming months:
April 25: Custody rules for digital assets
May 12: Tokenization and TradFi–DeFi crossover
June 6: Regulatory challenges in DeFi
Meanwhile, the agency has also issued new disclosure guidelines for crypto firms, urging transparent communication about business models, risks, and financials.
As incoming SEC Chair Paul Atkins prepares to take over, expectations are high that the agency may finally embrace more forward-looking crypto policies.
A finance graduate, Maheen Hernandez has been drawn to cryptocurrencies ever since Bitcoin first emerged in 2009. Nearly a decade later, Maheen is actively working to spread awareness about cryptocurrencies as well as their impact on the traditional currencies. Appreciate the work? Send a tip to: 0x75395Ea9a42d2742E8d0C798068DeF3590C5Faa5
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